United Wants Compensation After Boeing 737 MAX Back In Air

Oscar Munoz, the CEO of United Airlines, expects compensation “of some sort over time” once Boeing’s 737 MAX is back in service.

A United Airlines Boeing 737. Photo: United Airlines.

The carrier has canceled over 3,000 flights due to the 737 MAX grounding, although United remains supportive of Boeing. FlightGlobal reported on May 30 that Munoz, speaking at LaGuardia Airport, New York says:

“There will be recompense of some sort over time…The discussion of that is a bit early. Let’s get that aircraft back to flight safely.”

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Cash compensation may be part of Boeing’s solution

The United CEO’s comment follows closely those of Boeing CEO Dennis Muilenburg speaking on May 29th, and also reported by FlightGlobal. Muilenburg said

“Obviously, our customers’ fleet schedules have been interrupted by the Max [grounding],” adding that there are a number of ways Boeing “can address these issues.” He went on to say:

“In some cases, it’s services and training support. In some cases, there are other currencies that we can trade with customers…In some cases, cash may be part of the solution.”

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United Airlines recently canceled more Boeing 737 MAX operated flights, taking its cancellations up to August 3rd. FlightGlobal puts the total number of flights impacted for United at around 3,440 and about 0.5% of the carrier’s schedule for April through to July.

United was flying 14 Boeing 737 MAX and has a further 137 on order. Photo: United Airlines

Airlines appear supportive of Boeing

Munoz, speaking at the United Airlines annual shareholders’ meeting, just over a week ago, committed to flying on United’s first Boeing 737 MAX flight once the aircraft is returned to service. Speaking at LaGuardia Airport this week, the United CEO also reportedly confirmed that the current situation will not change the airlines’ interest in the MAX 10. Before the 737 MAX was grounded, Boeing had 14 737 MAX aircraft with a further 137 on order.

United Airlines has so far not revealed how much the 737 MAX grounding will cost the carrier. Rival American Airlines, with 24 737 MAX aircraft in its fleet, estimates the grounding will cost it in the region of $350 million. American’s CEO Doug Parker has also committed to being a passenger on one of its first 737 MAX flights once the plane is cleared to fly again.

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Carriers seeking compensation

FlightGlobal, citing the FAA, puts the number of 737 MAX grounded at 387, operated by 59 airlines. And, there could be over 100 more undelivered 737 MAX still with Boeing which should have been delivered and operational by now.

Reportedly Ryanair may already be progressing compensation discussions with Boeing over the grounding of the 737 MAX. Ryanair was due to receive its first 737 MAX in April, and five more over this summer. The deal could involve a substantial discount on Ryanair’s MAX orders.

The agreement is likely to include a discount of the money owed by Ryanair to Boeing. Photo: Ryanair

Other reports indicate AeroMexico is now planning to seek compensation from Boeing; it has six grounded 737 MAX. Norwegian Airlines was amongst the first to confirm it would seek compensation. And, China Southern Airlines and Air China said in May they would seek compensation joining China Eastern Airlines which has expressed a similar sentiment.